Tesla, Inc. (NASDAQ: TSLA) heads into the weekend of December 20, 2025 with its stock hovering just below recent record territory after a headline-heavy week that mixed major corporate-governance news, fresh robotaxi milestones, and new analyst forecasts that underscore how sharply opinions diverge on what Tesla is really worth.
Tesla shares last closed at $481.20 on Friday, Dec. 19, after a volatile five-session stretch that included an intraday high of $495.28 earlier in the week. [1]
Below is what investors are watching now—and why Tesla stock’s next major move may depend less on near-term EV deliveries and more on how fast Tesla can turn autonomy promises into a scalable business.
Tesla stock snapshot: near highs, but with sharp swings
Tesla’s rally into mid-December pushed the stock to new highs for 2025, fueled by optimism around autonomous driving, robotaxis, and AI-driven software revenue—themes that have become increasingly central to how the market values TSLA. [2]
But the same week also showed how quickly sentiment can whipsaw:
- Dec. 16 close: $489.88 (near record territory) [3]
- Dec. 17 high: $495.28 (then a sharp pullback) [4]
- Dec. 19 close: $481.20 [5]
That volatility is consistent with a market that’s trying to price two Teslas at once: a mature global EV manufacturer facing demand pressure in key regions, and a potential autonomy-and-robotics platform that bulls argue could redefine transportation economics.
The Dec. 20 headline: Delaware Supreme Court reinstates Elon Musk’s 2018 Tesla pay package
The biggest Tesla-related legal and governance catalyst dated Dec. 20 was the Delaware Supreme Court decision restoring Elon Musk’s 2018 compensation package—a plan once valued at $56 billion and now estimated at about $139 billion based on Tesla’s share price. [6]
Key points investors are digesting:
- The ruling overturns a 2024 decision that had rescinded the package. [7]
- If Musk exercises the restored options, his stake could rise from about 12.4% to 18.1% (on an expanded share base). [8]
- Reuters also noted Tesla’s newer pay plan (separately approved by shareholders) could reach extremely large figures if ambitious targets are met, while Tesla has taken steps to reduce the risk of similar shareholder litigation by incorporating in Texas. [9]
In market terms, the decision matters not only for compensation accounting and governance optics, but also because investors often link Musk’s incentives and control to the speed of execution on Tesla’s autonomy roadmap.
Musk’s wealth surge becomes part of the Tesla narrative
On Dec. 20, Reuters reported that Musk’s net worth surged to $749 billion, making him the first person to surpass $700 billion, according to Forbes’ billionaires index—an increase tied in part to the court decision reinstating Tesla stock options. [10]
While this is not a fundamental driver like margins or deliveries, it keeps Tesla in the center of a broader market story: Tesla’s valuation is increasingly intertwined with investor belief that it becomes an AI-and-robotics leader, not “just” an automaker.
Robotaxi momentum: “no occupants in the car” testing is the catalyst bulls keep citing
Tesla’s stock has also been reacting to signs that its robotaxi program is moving from supervised pilots toward more autonomous testing.
Earlier in the week, Reuters reported that Elon Musk confirmed driverless robotaxi testing in Austin with “no occupants in the car,” helping push the shares higher and reinforcing the view that Tesla is trying to accelerate toward broader deployment and a future Cybercab launch. [11]
Investors are watching this closely because:
- Tesla’s market value (often framed around $1.5T+) has been heavily influenced by expectations for autonomy and robotics, even though most revenue still comes from vehicle sales. [12]
- Tesla faces established competition in robotaxis, including Waymo’s large-scale commercial operations, which analysts frequently cite as the benchmark for paid, city-scale deployment. [13]
The stock implication is simple: the closer Tesla appears to “real” driverless service, the more bulls argue TSLA should trade like an AI platform rather than a cyclical car stock.
Forecast watch: Deutsche Bank expects Q4 2025 deliveries to undershoot—despite robotaxi optimism
One of the most concrete forecasts published on Dec. 20 came from Deutsche Bank commentary reported by Investing.com: analyst Edison Yu expects Tesla’s Q4 2025 deliveries at about 405,000 vehicles, below consensus and below the bank’s prior forecast. [14]
Deutsche Bank’s view highlights the split at the heart of TSLA:
- The projected shortfall is said to be concentrated in Tesla’s Western markets, with estimated delivery declines of 34% in Europe and 33% in North America (in their framing), while China is expected to be down roughly 10%. [15]
- Despite “near-term delivery and margin pressure,” Deutsche Bank said the robotaxi narrative remains key support for Tesla’s valuation and raised its price target to $500, keeping a Buy rating. [16]
This is the current Tesla stock paradox: analysts can be cautious (or even bearish) on deliveries while staying constructive on the stock because they believe autonomy and robotics will dominate valuation.
Analyst targets: raised numbers, but not universal conviction
Truist: raises target to $444, keeps Hold, calls valuation stretched
Truist raised its Tesla price target to $444 from $406 while maintaining a Hold rating, arguing that much of Tesla’s value depends on successfully bringing AI products and services to market—especially robotaxi services enabled by FSD. [17]
Truist also flagged how elevated expectations have become:
- Tesla shares were noted near their 52-week high of $495.28, with market cap around $1.61 trillion in the report’s snapshot. [18]
- The note cited a very high P/E ratio (335.68) and emphasized that analyst targets vary widely—from $120 to $600. [19]
- Truist warned that imperfections in FSD outcomes and competitor announcements could keep the stock volatile. [20]
Wedbush: $600 target, “pivotal year,” and an $800 bull scenario
Wedbush’s Daniel Ives reiterated an Outperform rating and a $600 price target, describing 2026 as pivotal and projecting robotaxis expanding to 30+ U.S. cities next year. [21]
Wedbush’s more aggressive framing includes:
- Potential Cybercab volume production around April or May (in Ives’ view). [22]
- A bull scenario that envisions Tesla reaching a $2T market cap over the coming year and potentially $3T by end of 2026, with an $800 stock scenario over the next 12–18 months. [23]
Morgan Stanley: valuation concerns and a more cautious stance
Earlier in December, Morgan Stanley downgraded Tesla from “buy” to a more neutral stance (as reported by Business Insider), citing valuation concerns despite acknowledging upside potential from autonomy and robotics. [24]
Regulatory risk: California sales-suspension threat is paused, but not gone
While robotaxi excitement is lifting the bull case, Tesla is simultaneously dealing with a major regulatory storyline in its biggest U.S. market.
Reuters reported that California’s DMV put a sales-suspension order on hold, granting Tesla time to address concerns that its marketing of “Autopilot” and “Full Self-Driving” overstates capability. [25]
What matters for TSLA holders:
- The DMV stayed the sales suspension for 90 days (and stayed the manufacturing license indefinitely). [26]
- To avoid suspension, Tesla was asked to either stop using the name “Autopilot” or submit a statement confirming the cars can operate without active human monitoring (per Reuters’ reporting of the DMV’s position). [27]
- Tesla could appeal or seek court review by Feb. 14. [28]
This issue is especially sensitive because it intersects directly with Tesla’s autonomy narrative—the same story driving much of the stock’s premium.
Europe and consumer-info scrutiny: Italy closes EV marketing probes
Regulatory scrutiny isn’t limited to the U.S. Reuters reported that Italy’s competition authority closed probes into Tesla and several automakers over alleged misleading information related to EV range, battery degradation, and warranty limitations—without imposing fines after companies agreed to clearer consumer disclosures and tools. [29]
For Tesla stock, the takeaway is less about immediate financial impact and more about the broader pattern: regulators are increasingly focused on what EV and autonomy claims mean in practice.
Fundamental backdrop: Tesla is still investing, still cutting prices, and still fighting for demand
Even as Tesla’s stock story shifts toward autonomy, core business fundamentals still matter—especially because EV revenue currently underwrites the AI ambitions.
Recent operational headlines include:
- Germany battery investment: Tesla plans to expand battery cell production capability at its Grünheide plant to as much as 8 GWh annually starting in 2027, bringing total investment in local cell production to nearly €1 billion, per Reuters. [30]
- Lower-priced Model 3 in Europe: Tesla launched a cheaper Model 3 variant priced at €37,970 in Germany, with deliveries expected to start in Q1 2026, aiming to bolster demand amid intensifying competition. [31]
These moves reflect a company trying to defend volume and market share—particularly in Europe—while simultaneously asking investors to value it as a next-generation AI platform.
What TSLA investors will watch next
With the market closed on Dec. 20 (Saturday), the next key catalysts are already lining up:
- Q4 2025 deliveries: The debate is whether Tesla can beat—or miss—expectations, with some forecasts calling for a shortfall. [32]
- Autonomy rollout signals: Any credible expansion timeline, new-city announcements, safety data, or commercial-service detail could move the stock quickly—up or down—given how central robotaxi expectations are. [33]
- California DMV deadline path: Whether Tesla changes branding, provides assurances, or appeals by Feb. 14 is a major headline risk because it touches both sales and the autonomy thesis. [34]
- Margin and pricing strategy: Cheaper models and regional pricing moves may stabilize demand, but they can pressure automotive margins—one reason some analysts remain cautious even as they raise targets. [35]
Bottom line: Tesla stock remains an autonomy referendum
As of Dec. 20, 2025, Tesla stock is being traded less like a traditional automaker and more like a high-beta bet on robotaxis, FSD software, and robotics—a shift reinforced by the week’s robotaxi testing headlines and Wall Street’s willingness to keep (or raise) lofty targets even when delivery forecasts soften. [36]
At the same time, the valuation premium brings sharper consequences: regulatory scrutiny and quarterly delivery surprises can trigger outsized moves, because the market is effectively pricing Tesla’s future—not just its current car sales.
References
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